General Questions
- Why are the insurance prices on the Internet so low?
- Can I get a quotation now online?
- What does a life insurance broker do?
- What's the difference between a "Guaranteed" and "Reviewable" policy?
- What are the most common optional extras you can have with a Mortgage Life Insurance policy?
- What happens if I stop paying my premiums?
- What do we mean when we talk about a policy's "term"?
- What do we mean when we talk about a policy's "level of cover"?
- What is the difference between a "Joint" policy and a "Single" policy?
- How can I make a claim?
Why are the insurance prices on the Internet so low?
There are a number of reasons why prices are low:
· The selling costs on the Internet are much lower compared with the traditional Financial Adviser sitting on your sofa. Furthermore, there is intense competition on the Internet for financial services. Low operating costs and intense competition have effectively made the Internet a low price environment, especially for life insurance.
· As the Internet has increased in popularity, the numbers of people searching for financial services mushroomed. This has meant that the Web based discount brokers have become very big operators. As a result, these discount brokers command especially good deals from the insurance companies. These deals are passed on in even lower prices.
The following Frequently Asked Questions are related to the above topic. Click here if
you wish to read them: -
Is the price I’m quoted, the price
I pay?
Will my mortgage lender
accept a Life Insurance policy bought online?
Can I get a quotation now online?
No, not immediately. You can request a quote, and then you will be contacted with more details by Clickloans.
Some web sites will give you an immediate quotation (you will often see these companies advertising in the press and on TV). However, be aware that most Banks and Superstores are tied to just one Insurance Company whose policies they have to sell. This means that they may be far less competitive than a discount broker who conducts business with a wide range of insurance companies.
In our experience, around 1 in 10 web sites will give you an online quotation. .
The information you will need to provide in order to get a quotation will include your date of birth, whether you are a smoker, the sum you want insured and how long you want to be insured. If you want a joint policy, the same information will be required about the other proposed policyholder.
The following Frequently Asked Questions are related to the above topic. Click here
if you wish to read them: -
Why are the insurance prices
on the Internet so low?
Is the price I’m quoted, the price
I pay?
What does a life insurance broker do?
A Life Insurance Broker links you with the Life Insurance Company. Their job is to find you the cheapest Life Insurance policy that matches your needs and organise the insurance on your behalf. If the Broker is providing specific personal advice, they should also complete what is called a “Fact Find”. This is a personal financial survey which helps them advise you what type of policy you need.
Fact Finds are very complicated and it is generally not possible to conduct an accurate Fact Find without a personal meeting.
We tackle this problem on the Internet by providing you with extensive information so that you can decide for yourself what you need.
Most Insurance Brokers receive commission for selling insurance policies, although some may charge fees as an alternative. This should not affect their selection of insurance companies or the contracts offered or recommended to you. The Financial Services Authority has said that it prefers the concept of fees rather than commission. However, VAT is charged on fees whereas there is no VAT on commission. So, on a like for like basis, commission will work out cheaper. For this reason, commission arrangements are the norm for policies bought through the Internet. home insurance
For more information about the Financial Services Authority visit www.fsa.gov.uk
The following Frequently Asked Question is related to the above topic. Click here if
you wish to read it: -
Why are the insurance prices on the Internet so
low?
Get a Quote Online Now
Cheap life insurance
What’s the difference between a “Guaranteed” and “Reviewable” policy?
With a “Guaranteed” policy the insurance company guarantees never to increase the premium at any time during the duration of the policy.
With a “Reviewable” policy the insurance company reviews your premium at regular intervals (normally every 2 to 5 years but this interval does vary between insurance companies).
At each review the insurance company has the right to increase your premium. In our experience, “Reviewable” policies tend to experience price increases slightly in excess of inflation.
As you would expect, at the outset “Guaranteed” policies have higher premiums than “Reviewable” policies - but Reviewable policies can soon catch up. In the longer term “Reviewable” policies are generally work out more expensive.
Just one quick point. Many insurance companies have ceased offering “Guaranteed” rates for combined Mortgage Life Insurance and Critical Illness policies. However, if you can get a quote on a “Guaranteed” Mortgage Life Insurance and Critical Illness policy - you should seriously consider it.
The following Frequently Asked Questions are related to the above topic. Click here
if you wish to read them: -
What is Critical Illness
Insurance?
What illnesses does
Critical Illness Insurance cover?
What are the most common optional extras you can have with a Life Insurance policy?
When you are pricing your Life Insurance policy you will normally be asked whether you want to include either of two optional extras: -
1. Critical Illness cover
If you can afford it, Critical Illness Insurance is a “must” for modern families.
It provides you with a tax-free capital sum to pay off your repayment mortgage if you are diagnosed with a critical illness. With Mortgage Life Insurance (which is used in conjunction with a repayment mortgage), the sum insured for critical illness decreases over time in line with the mortgage life cover and the value of your mortgage.
If you have an interest only mortgage, you will need standard, level cover, Life Insurance. If you add Critical Illness cover to a standard Life Insurance policy, the sum insured for critical illness remains constant – it does not decrease over time as it does if it were included on a Mortgage Life Insurance policy.
Critical Illness cover which decreases over time, is less expensive than Critical Illness where the sum insured is constant.
Please note that if the policy pays out for a critical illness – the policy is finished. It doesn’t pay out again if you die!
The following questions are related to points raised above. If you wish to read them
please click here:
I have a Repayment Mortgage.
What sort of life insurance do I need?
I have an interest only
mortgage. What sort of life insurance do I need?
What is Critical Illness Insurance?
Why should you consider
combining Life Insurance with Critical Illness insurance?
What illnesses does Critical Illness Insurance
cover?
2. Waiver of Premium
This is an option whereby the insurance company pays your policy’s monthly premiums
if you were off work through illness, or became unemployed. It is relatively cheap and
you should consider including it.
What happens if I stop paying my premiums?
If you stop paying your policy the insurance company or broker that your policy is with will first write to you advising you that it has not received your payment. It will do this just in case the missed payment was an oversight or a banking error.
Their letter will also advise you that unless they receive the missing payment within a specified period of time, the policy will be automatically cancelled.
If your policy is cancelled it cannot be re-started. If you want to be insured again you will have to reapply and, being older, the premium will probably be higher.
If it was a condition of your mortgage advance that you had insurance cover, then if you fail to maintain the insurance, you may be in breach of your mortgage conditions. This could have serious implications and, before you decide to stop paying your insurance premiums, you should speak to your mortgage lender.
Life insurance policies do not have any investment value. If you cancel a policy, it’s finished and you have no commitments to make further payments.
If you included the “Waiver of Premium” option within your policy and the reason you have stopped paying the premium is because you are off work through illness, accident or unemployment, you should contact your insurance company. They will then make arrangements to credit you policy with the premiums.
The following question is related to point raised above. If you wish to read it please
click here:
What are the most common optional extras
you can have with a Life Insurance policy?
What do we mean when we talk about a policy’s “term”?
A policy’s “term” is the period of time you have chosen the policy to provide you with insurance cover.
Normally, “term” is expressed as a number of years.
The following question is related to point raised above. If you wish to read it please
click here:
How much should you insure
for?
What do we mean when we talk about a policy’s “level of cover”?
A Life Insurance policy’s “level of cover” is the amount of money that the insurance company would pay out if a policyholder were to die or become terminally ill whilst the policy is in force.
Or to put it simply, it’s the sum you insure a person’s life for.
The following question is related to point raised above. If you wish to read it please
click here:
How much should you insure
for?
What is the difference between a “Joint” policy and a “Single” policy?
A “Single” policy is a policy where there is just one person insured.
A “Joint” policy is a policy which insures two or more people. (It can be more than two, although this is unusual.)
If your mortgage has been taken out in joint names you should have a “Joint” policy (some mortgage providers will insist on this) otherwise a “Single” policy will suffice.
For mortgage purposes, “Joint” policies are always taken out as “first life” policies. This means that the policy will pay out if either of the policyholders were to die or become terminally ill, during the policy’s term. Please note that once a “Joint” policy has paid out on a first death, the policy is finished – it will not pay out again if the second person were to die.
How can I make a claim?
Any claim is made to the Insurance Company who issued your policy. Details of how to claim will be found within the booklet they provide with your policy.
However, if a claim arises and you or your dependents are unsure on how to proceed, then contact the agent or broker through whom you purchased the policy. You will find details of the broker within the insurance documentation. They will provide the information you require.
If a life insurance policyholder dies or becomes terminally ill, the insurance company will be ready to make a speedy payout - but there are a few procedures to follow to make sure this happens.
Firstly find the insurance policy and for safety’s sake make a note of the policy number. Then phone the insurance company and they will send you a claim form. Then you need to obtain a certified copy of the death certificate or your Doctors’ written confirmation the terminal illness. (The insurance company’s definition of a “terminal Illness” is an illness from which a medical practitioner expects the policyholder to die within 12 months). Your Doctor or funeral director will help you with this.
When the claim form arrives, complete the details and return it to the insurance company together with the insurance policy document and other required documentation. We think it would be best to use Recorded Delivery.
The insurance company will then pay the claim promptly.
What happens if the insurance policy cannot be found?
Don’t worry yourself. It’s not uncommon to lose a policy! The insurance company can be traced through the premium payments made through the bank account. The bank will be able to help you identify the insurance company and the payment reference number. Then phone the insurance company and they’ll quickly trace it and issue lost policy form for you to complete.
Incidentally, it's a good idea to get your Life Insurance policy written “in Trust”.
This will ensure that, in the event of a claim, the money goes quickly and directly to
the people you intended. It also avoids any Inheritance Tax. That could represent a tax
saving of 40%!
--Please Note --
This web site is owned and managed by Alliance Internet Ltd.. Alliance Internet Ltd is an Appointed Representative of Financial Connexions Ltd. Financial Connexions Ltd is authorised and regulated by the Financial Services Authority.